Senator William Frist (R-Tenn) will speak at the June legislative event.

The Senate majority leader will be the keynote speaker at the American Association for Homecare (AAHomecare) Washington Legislative Conference on June 2-4, 2003, at the Loews L’Enfant Plaza Hotel in Washington, DC.

In addition to the keynote address from Senator William Frist (R-Tenn), the event, titled “Advocating Homecare as THE Health Care Solution,” will include a “Pre-Hill Strategy” session presented by Soapbox Consulting, the organization’s annual business meeting, and Capitol Hill appointments. Members of Congress are invited to attend a reception following the legislative appointments. Providers can also attend a HIPAA workshop ($150, members; $250, nonmembers) on June 2 from 1 pm to 5 pm.

Registration costs $295 for members and $395 for nonmembers. A package rate, including both the HIPAA workshop and the legislative conference, is available for $395 for members and $495 for nonmembers. The registration fee includes conference materials, lobbying material, a Congressional handbook, breakfasts, and receptions. For room reservations, contact Loews L’Enfant Plaza Hotel at (202) 484-1000.

From previous experience, Fisher is familiar with the funding and regulatory issues that face the health care industry in general and, according to AAHomecare, is looking forward to tackling the issues more specific to home care, such as competitive bidding and branding the industry’s message of improved outcomes at lower cost.

“I’m pleased to be a part of this growing association and am eager to use my experience in public affairs and government relations to help it achieve its goal of communicating that home care is a solution to our nation’s health care crisis,” Fisher says.

AAHomecare Releases Financial Performance Questionnaire
Providers interested in participating in the American Association for Homecare (AAHomecare) 2003 Financial Performance Survey must fill out a questionnaire by May 30.

The questionnaires are available on the organization’s Web site at www.aahomecare.org/surveyform.htm. AAHomecare expects a summary report of the results by early September 2003.

A source of benchmarking information on the home care industry’s financial performance, the annual report presents financial variables in terms of industry averages. It also provides comparisons with firms of similar size and product line. In addition to income, expense, and balance sheet information, there are special sections on labor costs, clinical and delivery management, billing productivity, and accounts receivable collections.

The updated 2003 survey also includes sections on the costs associated with Health Insurance Portability and Accountability Act compliance and sleep-disordered breathing services.

“Companies learned through their advocacy activities on competitive bidding last year that they need to get a better handle on their financial performance, especially those costs associated with providing the value-added services unique to home care,” says James Jorkasky, senior vice president, Membership and Strategic Development, AAHomecare. “This message also was reiterated by more than 30 speakers at the recent AAHomecare Leadership Conference and IT Summit, who challenged the industry to capture the data that supports home care’s message of improved outcomes at lower costs.”

AAHomecare members who complete the questionnaire will receive the final survey report for free, plus a company-specific analysis and an industry profitability report. Participating nonmembers will receive the survey report for $250—50% off the sales price. For more information, visit AAHomecare’s Web site at www.aahomecare.org.

Air Products Reaches Midwest With Acquisition
With the purchase of DependiCare Home Health Inc, Broadview, Ill, in March, Air Products, Allentown, Pa, hopes to have established a foothold in the Midwest home care market. The company says that DependiCare’s locations in Sycamore, Elgin, and South Beloit, Ill, will provide a hub for further growth in the Illinois/Indiana area providing HME, oxygen therapy equipment, and related supplies.

Roger Miller

Established in 1983, DependiCare adds 10,000 patients to Air Products’ existing base of roughly 300,000 patients worldwide. Last year, the company was honored as the runner-up for the 2002 HME Excellence Award for the best home respiratory service providers in the United States. DependiCare will retain its name as well as its 125 employees. Roger Miller will continue as president.

“We are excited about our new relationship with Air Products,” Miller says. “This will enable us to use our business platform to expand Air Products’ presence throughout the Midwest and to provide our employees with new challenges and opportunities.”

The purchase of DependiCare is the latest in a series of four recent acquisitions made by Air Products. Financial terms were not disclosed.

AAHomecare President and CEO Thomas Connaughton

A group of national and state-based consumer and provider nonprofit organizations designated to “identify and build support for policies and legislation that will improve access to and coverage of assistive devices, technologies, and services for people of all ages with disabilities,” met for the first time on March 28.

Called the Independence Through Enhancement of Medicare and Medicaid (ITEM) coalition, the organization plans to implement an educational and advocacy campaign to promote the idea that improved coverage and access will bolster patients’ health, functionality, and independence. ITEM intends to use personal stories to convey this message.

According to the American Association for Homecare (AAHomecare), Alexandria, Va—one of 100 organizations invited to join—the coalition will initially focus on strengthening Medicare coverage of DME and other assistive devices, technologies, and services.

“ITEM is the voice of consumers, and their first-hand experience with the failings of our Medicaid and Medicare system makes them particularly well qualified not only to identify gaps in funding, but also to call on our government to address these coverage issues,” says Thomas Connaughton, president and CEO of AAHomecare.

One of the Medicare policies that will be addressed, according to AAHomecare, is the “home-bound” provision that has been used to deny payment for Medicare beneficiaries who need mobility devices outside of the home. ITEM will also look at expanding the concept of “functional status” to take “medical necessity” into consideration.

The nonprofit organizations that initiated the coalition were Advancing Independence: Modernizing Medicare and Medicaid, the Consortium for Citizens with Disabilities Health Task Force, the American Foundation for the Blind, Paralyzed Veterans of America, and the Medicare Rights Center.

The council will seek to improve the process by which CMS decides whether to cover new technology approved by the US Food and Drug Administration.

“The [Medical Technology Council (MTC)] will reduce the time needed for making and implementing Medicare coverage decisions for new technologies and making CMS’ process as seamless as possible for outside stakeholders,” Scully says.

The MTC will be composed of the director of CMS’ Center for Medicare Management and the director of the Office of Clinical Standards and Quality. Staff from these two CMS components and others will attend and participate in council meetings, depending on the agenda. The council will meet bimonthly as well as on an as-needed basis. Its primary activity will be to expedite resolution of technology coverage issues by consulting with all affected CMS components, developing resolution plans, clarifying responsibilities, establishing time frames, and following up to ensure resolution.

RATC Task Force Presents Code Applications
To meet an April 1 deadline, the American Association for Homecare (AAHomecare), Alexandria, Va, Re/hab and Assistive Technology Council (RATC) Coding Task Force submitted more than 20 Healthcare Common Procedure Coding System (HCPCS) code applications to the Centers for Medicare & Medicaid Services (CMS).

The proposals covered alternative positioning, ambulatory products, bath safety, configured seating, manual wheelchairs, power wheelchairs, and wheelchair accessories. They were developed by the task force of rehabilitation suppliers and manufacturers founded in September 2001 “to identify coding deficiencies in the current Medicare HCPCS with respect to rehabilitation products,” AAHomecare says.

“Developing code applications by work group is a unique approach because it involves not only the manufacturers, but also the suppliers who will ultimately utilize the approved codes in the billing process,” said Rita Hostak, chair of the RATC Coding Task Force, in an April 4 AAHomecare newsletter. “By doing code applications this way, the rehabilitation industry can present CMS with comprehensive codes that properly define rehabilitation products.”

Since all private and public payors will have to use national HCPCS codes instead of local codes by October 2003 due to the Health Insurance Portability and Accountability Act (HIPAA), AAHomecare considers the task force’s ongoing project critical. Last year, the task force submitted code applications for pediatric mobility base and wheelchair products.

If requested by CMS, the RATC Coding Task Force will participate in the open HCPCS coding meeting in June to address questions regarding the code applications, according to AAHomecare. The final coding decisions are scheduled to be released by CMS in November 2003.

MedPAC Gets Lesson in AWP
At a March 27 meeting with the American Association for Homecare (AAHomecare), Alexandria, Va, Medicare Payment Advisory Commission (MedPAC) staff said they were aware of the cost of services necessary to administer drugs in the home, but seemed to not comprehend the “intensity and frequency of the services provided,” according to the March 28 AAHomecare newsletter.

AAHomecare called the meeting to show MedPAC how using only the average wholesale price (AWP) of drugs to compute the reimbursement provided under Medicare Part B affects home health care providers. And MedPAC recognized this, according to AAHomecare.

MedPAC staff indicated after the meeting that a draft chapter they were working on—to be reviewed by the commissioners at an April meeting—would contain alternatives to the current use of AWP.

AAHomecare: Medicare Reform Bill Proposes Uneven Appeal Process
Although a regulatory reform bill, approved March 26 by the House Committee on Energy and Commerce, would improve providers’ access to education and technical assistance, the American Association for Homecare (AAHome- care), Alexandria, Va, expressed concern about its revisions to the Medicare appeal process.

According to the House committee, the bill—called the “Medicare Regulatory and Contracting Reform Act of 2003” (HR 810)—seeks to improve Medicare by eliminating paperwork for beneficiaries, improving the contracting process, and clarifying provider rights. AAHomecare is concerned about a provision stating that during an appeal before an Administrative Law Judge (ALJ), providers may not introduce any evidence, such as live testimony, that was not presented before a Qualified Independent Contractor (QIC) during reconsideration. However, QICs would be able to present new evidence or live testimony during an appeal.

“This would create a significant dilemma for providers and suppliers since the contractor could argue a different basis for its determination other than the one that it presented at the QIC level, and the provider or supplier would be prevented from presenting evidence to contradict the contractor’s new claim,” the March 28 AAHomecare newsletter reported.

The only exception to the regulation would be if a provider could establish “good cause” for not introducing the evidence earlier, the bill says.

The bill must still go through both houses and be signed by the President to become law. To prevent this provision from going that far, AAHomecare suggests concerned providers contact their state representatives.

CMS Announces Preliminary Managed Care Rates
In 2004, the Centers for Medicare & Medicaid Services (CMS) will raise the Medicare+Choice reimbursement, in most counties in the United States, to more than the 2% minimum increase guaranteed by law and phase in a risk adjustment methodology to help the sickest beneficiaries.

Despite the reimbursement rate increasing in most counties, most beneficiaries enrolled in managed care plans will see only the guaranteed 2% hike since most are concentrated in the counties due to receive only the law-mandated increase. The rates are a result of CMS’ preliminary estimates of the national growth rate used for determining the increases in Medicare+ Choice payment rates in all counties. The final new rates for all counties will be announced on May 12.

The risk adjustment methodologies, which, according to CMS, are more accurate, will increase payments to Medicare managed care plans that enroll the sickest beneficiaries. In 2004, 30% of a plan’s payment for each Medicare+ Choice beneficiary will use the new methodology based on both diagnoses from inpatient hospitalizations and outpatient and physician settings.

Risk adjustment looks at a person’s diagnosis in 1 year and predicts how much, if any, additional cost there will be for that person the next year. CMS currently pays Medicare health plans a fixed monthly amount per beneficiary, adjusted by factors such as age, sex, and Medicaid status and inpatient hospital diagnoses.